Medicare Knows Everything About My Patients, But Hopes I Will Forget

My clinic belongs to an Accountable Care Organization. My job is to keep my patients medical costs down, in my clinic as well as in the hospital and specialist offices, without sacrificing quality. Of course, I have about zero control over costs generated outside my office.

So, since I can’t do very much about what Cityside Hospital and all the specialists they employ charge for their work, my only chance of getting any “shared savings” is to make my patients look real bad.

That is what some of the Medicare Advantage plans (Federally subsidized for profit contractors who manage Medicare subpopulations that get extra benefits, like glasses and gym memberships, in exchange for Prior Authorizations and other forms of rationing). I used to puzzle over why they paid us $150 just to update/verify my patients problem lists until I got caught up in the same situation through no fault of my own. Now I also know why these lists sometimes contained outrageously erroneous diagnoses such as paraplegia.

The baseline cost, from which any savings (shared savings for my clinic) or the dreaded opposite is calculated, is predicated on complex actuarial formulas, summarized in what Medicare calls Hierarchical Condition Categories.

This is how that works:

Even through Medicare paid for patient X’s medical care in previous years, and received bills with all of his terrible diagnoses listed, they calculate my base “cost” only counting the diagnoses submitted recently. If they don’t see anything that looks expensive, they budget about $8,000 for the coming year for that patient. Never mind that he is a quadriplegic amputee (which I might not include as a reason for any particular visit, although I might treat and code for his bedsores). Of course, since he may need a new power wheelchair anytime, I wouldn’t want that cost to drag down my “performance”, so I’d better put “quadriplegia” and “below-the-knee amputation” on at least one superbill every year.

It seems obvious they hope I’ll forget to “take credit” for how sick Mr. X really is, so that his multiple hospitalizations and new power chair will hurt my clinic’s bottom line.

In other cases, it is more a matter of word choice: If somebody has fairly stable heart disease and takes nitroglycerin two or three times per year, “coronary artery disease” gets me no points, whereas “angina pectoris” jacks up my baseline a little.

Obesity is an interesting problem. If a patient is morbidly obese, that gives me more of this HCC “play money” to work with. Once they lose the weight, I will of course lose those dollars. But there are quality bonuses to be gained from treating obesity. However, Medicare will REJECT any and all claims for office visits conducted solely for the purpose of treating obesity.

There is obviously more money to be made, at least for the next several years, from aggressive coding than from looking over the shoulders of hospitalists and specialists. I can’t even tell from the hospital reports exactly what they did and why they did it. So how and why could I gain more from that than from becoming a Hierarchical Condition Category Coding expert?